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Austria: How to Finance Future Innovations

Published: April 9, 2013; 18:30 · (Vindobona)

„Austria’s Future Needs Innovation” was the title of a discussion organized by the Research Council, the Austrian Institute of Technology (AIT) and the Federation of Austrian Industries (IV).

Austria: How to Finance Future Innovations / Picture: © IV / Günther Peroutka

Innovation needs to be financed. But how? Which state reforms could have such far-reaching impact it provides enough margins for investments in the future? These were the main questions. The Council for research and technological development has together with the Federation of Austrian Industries, the former Swedish Prime Minister Persson and Austrian experts invited to highlight individual aspects of the global, social and economic developments, as well as the resulting requirements in regard to the education, innovation and pension securing system, in the course of a panel discussion.

Former Swedish Prime Minister Hans Göran Persson announced that Austria was a successful country but it will not always stay that way. He explained that it is all about competition and the prime target is to keep on top. Therefore, permanent and consistant reforms are necessary as other countries were waiting. Sweden has carried out extensive reforms in the 1990s, not least to reduce the public debt, and the economy has been flourishing ever since. Today, Sweden is leading many rankings, among them the Innovation Untion Scoreboard, which is a standard for the innovation strength of a country.

The participants in the discussion all agreed that this was a model Austria should follow. Persson affirmed that the problem was not in realizing what to do but simply to do it. The reform of public financing would, according to him, not need a genius but the political will and the support of the majority of the country in the long run.

Hannes Androsch, president of the supervisory board of the Austrian Institute of Technology, agreed that Sweden had ‑ not only theoretically ‑ proved how to do it. He is sure that Austria could manage too. However, in his opinion there were some “hinderers, blocking the necessary reforms”.

Therese Niss from Junge Industrie confirms that Sweden had a high pressure to perform and that the country was able to shape the administration to a more efficient working process. She highlights that Austria still has a lot of potential in this regard. Furthermore, Niss criticizes that the means would not be invested in the wrong way. Even though Austria spends a lot of its buget on education only every second Euro would actually reach the schools. She further explained that the foundation for the interest in technology and science would be laid in kindergarten already.

Gertrude Tumpel-Gugerell, president of the supervisory board of the Austrian Research Promotion Agency (FFG), sees no reason why Austria is not among the most innovative countries. She strongly supports a consequential pursue of the reform process, which – according to her – would involve a public debate. Moreover, she demands an improved cooperation between the educational system, research and the economy.

Vice Chancellor of the University of Technology in Vienny, Sabine Seidler regards the university as an important link. However, she explains that the institutes would have to face difficult framework conditions.

In order for Austria to survive in the international competition, Europa and particularly Austria as a country lacking in raw material both have to build on science and knowledge-based innovation and education, and make investments in these areas determinedly. For years there has been a lack of reforms. Major structural reforms which are necessary in administration, the pension system or the healthcare system have been delayed for years, and keep resources that sectors like education, science and innovation, which are important for the future, are missing.

Georg Kapsch too, President of IV, emphasized that Austria would invest too little of its budget for important areas like education, family, science and innovation.